Kazakhstan joining a coveted list of top-50 countries, according to the WEF Global Competitiveness Ranking Report, as well as the Doing Business Report 2014, is, undoubtedly, an outstanding achievement. However, its too early to talk about the success, since in many other international rankings our country's position is not so bright.

Best 30 countries

Let’s remind that since Kazakhstan has moved this year to the 50th position in the rankings of the World Economic Forum, the Head of State has assigned the Government with not less ambitious task: joining the Top 30 of the most developed economies. To fully comprehend the enormity of the task, let's see the features of the most developed countries.

There are many selection criteria. However, generally the top 30 consist of the states, whose economy makes the largest contribution to the global one. According to statistics, these countries produce more than half of the global GDP and only 15% of the world's population live in their territory .

The most developed countries are characterized by a high standard of living and large capital reserves. They are characterized by a uniform distribution of income, a significant investment into the science, medicine and environment. Economically, developed countries usually export not only their products, but also their capital, and most of its residents are involved into the highly productive work activities.

An example is the practice of the International Monetary Fund, which today includes a list of the top 30 countries (given in alphabetical order): Austria, Australia, Belgium, Britain, Denmark, Germany, Iceland, Ireland, Israel, Spain, Italy, Canada, Cyprus, Luxembourg, Malta, Netherlands, New Zealand, Norway, Portugal, the United States, Singapore, Slovakia, Slovenia, Finland, France, Czech Republic, Sweden, Switzerland, South Korea and Japan.

The IMF specifically identifies the group of highly developed states, named as the "Big Seven". They include the leaders of the world’s economy: United States, Canada, Japan, Germany, United Kingdom, France and Italy. These countries have achieved the best performance and the highest rates in the science and technology. They account for approximately 50% of the global import and about 80% of the global industrial production.

The United States were considered as an undisputed leader among the developed countries during the last century. However, since the beginning of the 21st century, due to the economic and financial crises, as well as the rapid growth of developing states, the USA are gradually leaving their positions. The increasing importance is being given to the BRICS countries and, particularly, to China, which demonstrates, year after year, the high rates of economic growth and based on the GDP rate it has already become the second economy in the world.

Meanwhile, some experts believe that is now becoming increasingly difficult to determine which countries should be classified as the developed or developing ones. For example, the Head of GSAM, the largest global investment banking group Jim O'Neill is confident that the traditional division between the developed and developing countries is already out-of-date.

However, most of the analysts agree that such segmentation is still relevant, because of the significant differences between the states in terms of their economic, social and political development.

Less Economic Freedom

Can Kazakhstan Make a Shift in Quality? If you look at our place within the Index of Economic Freedom, the prospects of joining the top 30 are not so optimistic. As it was noted in the report, Economic Freedom of the World: 2013, published by the Institute for Development and Economic Policy (Kazakhstan), jointly with the Fraser Institute (Canada) for the last seven years we "fell back" in this ranking from 42 place to 8 place (out of 151 surveyed countries). And it is despite the fact that, according to the Report, there is, generally, less economic freedom in the world. So, in a global scale the average value of this indicator increased from 6.74 in 2012, up to 6.87 points in 2013 (out of 10 possible).

According to Pavel Koktyshev, Director of IDEP, the research shows that citizens of countries with a high level of economic freedom are not only living in conditions of greater prosperity, as well as the higher levels of political and civil liberties, but also they have a higher life expectancy.

It is noteworthy that in 2012 Kazakhstan held the 70th place in this ranking (that was one of the best indicators among the post-Soviet countries), and in 2011 it retained firmly the 56th place. In this regard, the disappointing conclusion is clear: there is less and less economic freedom in our country from year to year.

Still, it should be noted out that we show positive dynamics on some of the selected indicators of this rating. For example, according to the indicator of "Legal System and Protection of Private Property," in 2013, Kazakhstan scored 6 points against 5.66 as of the last year (a higher value indicates a higher level of economic freedom). The results were positive in terms of the “Regulation of Credit, Labour and Business ares" – 7.48 against 7.6.

The currency stability (8.24 against 8.2), as well as the freedom of international trade (from 6.37 to 5.4) are showing less results. By commenting the latter criterion, Mr. Koktyshev shared that “In the sphere of freedom of international trade, our results were much worse (from 111 position Kazakhstan moved to 141), against the background of the general global improvement of this indicator. Mostly, I link it with the impact of the Customs Union, precisely, with the more complicated import procedures."

Some comfort gives us the fact that our neighbours Russia and China have the worse economic freedom indicators: they occupy, respectively, 101 and 123 position.

Well, as in the previous year, Hong Kong became the rating leader. Together with Hong Kong, another leaders are Singapore and New Zealand. The honourable fourth and fifth places are taken by Switzerland and the U.A.E.

The position of the United States seems unusual, because for a long time they were considered as the champions in terms of economic freedom among the industrialized countries. This year, the States continued their descent in the rating, dropping to the 17th position. But back in 2008, they held the 10th place, when in 2002 they were the seconds in the rating. As it is noted in the report, a major role in the fall was played by the high expenditure level of the American Government.

As to the outsiders, the latest, the 151st place, is occupied by Venezuela. Just above, in ascending order, are the counties of Myanmar, Zimbabwe, Congo and Angola. It should be added that the report on Economic Freedom of the World is prepared annually by the Fraser Institute (Canada's leading centre for the study of public policy), in cooperation with independent institutes from more than 90 countries of the world. The rankings used 42 indicator, the most important of which are the personal choice, voluntary exchange, freedom of competition and security of private property.

Better than Neighbours

The position of Kazakhstan doesn’t seems better according to the Global Slavery Index. This year, according to the independent Australian company Walk Free Foundation, our Republic took the 85th place out of 162 countries studied. According to experts, there are from 44 up to 49 thousand people being slaves in Kazakhstan. But it should be mentioned immediately that the "slavery" in this case refers not to the classical slavery, but to the early marriage, forced marriage, trafficking and dependence from the creditors. Approximately 29.8 million people suit such criteria in the world. As indicated by the rating, the people are enslaved most often in the U.A.E., Turkey and Russia, whereas the victims of trafficking in our country are mainly the citizens of Uzbekistan.

By the way, according to this ranking, we look better than our neighbours; the countries of Central Asia and Russia, which have proved to be far above us (the higher the rank, the higher the level of slavery). So, Uzbekistan occupies 47th line, Russia – 49th, Kyrgyzstan – 81st, and Turkmenistan – 83rd one.

The worst result in the rating are shown by Mauritania. Behind it, there are Haiti, Pakistan, India, Nepal, Benin, Ivory Coast, Gambia and Gabon. The most slavery-free countries are Iceland, Ireland and the United Kingdom, sharing 160th place. In addition to these States, the top 10 include Denmark, Finland, Luxembourg, Norway, Sweden, Switzerland and New Zealand.

One of the most original global ranking is the so-called "happiness" rating and this year Kazakhstan got close to the top 50. As it is noted in the World Happiness Report, prepared by the American researchers and commissioned by the United Nations, we climbed two positions, finishing in the 57st place out of 156 countries. It is noteworthy that the Kazakhstan is again ahead of its neighbours, Turkmenistan (59), Uzbekistan (60), Russia (68) and Kyrgyzstan (89).

The leadership in the ranking of happiest countries was kept by Denmark and Norway, while Finland ceded its 3rd place to Switzerland, taking only the seventh position. The fourth line is taken by the Netherlands, the fifth by Sweden and the sixth by Canada. The top 10 is completed by Austria, Iceland and Australia.

The outsiders are traditionally the African countries: Togo (154), Benin (155) and the Central African Republic (156). It remains to add that the rankings of happiness takes into account such indicators as GDP per capita, life expectancy, level of trust among the society, freedom of choice, level of corruption and generosity.

In the CIS, we just go behind Russia

Against the background of quite respectable place among the happiest countries in the world, 73th position of Kazakhstan in the World Bank ranking in terms of Gross National Income (GNI) per capita (see Table 1), seems bit illogical. But even on this regard, our Republic has demonstrated quite decent results, compared to other CIS countries. Having the indicator of $9 730 based on results of 2012, we have only Russia before us (59th place, $12 700), leaving Ukraine (120) far behind us.

Traditionally, the World Bank divides all the countries into three categories: countries with high per capita incomes (from $12 616 and above), medium (from $1 036 to $12615) and low (from $1 035 and lower). This means that Kazakhstan joined the group of countries whose GNP per capita corresponds to the average level.

The leadership belongs to the Principality of Monaco ($186 950), followed by Liechtenstein ($136 770), Bermuda ($ 106 920), Norway ($98 860) and Switzerland ($82 730). Among the Arab countries, the highest ranking is given to Qatar ($78 720), located in the sixth line.

Surprisingly, most of the Western countries with the biggest economies could not join the top 10 countries. So, the United States took only the 14th place, while Germany, France and the United Kingdom couldn’t even reach the top 20, occupying, respectively, 22, 24 and 27 places.

Among the BRICS countries, Russia seems the best one (59), followed by Brazil (66), South Africa (80) and China (94). The worst result is shown by India (146).

Ironic, but True. Despite the debt crisis, Cyprus (36) and Greece (37) with revenue of $26 million and $260 per person, are listed higher than the BRICS countries. At the last place, 193rd in the ranking, is the Democratic Republic of the Congo with its very modest $220.

HDI is still not good

Very important from the viewpoint of Kazakhstan’s advancement towards the top thirty is our position in the Human Development Index (HDI), calculated by UNDP experts every year. After all, the availability of adequate human capital is the key to competitiveness. According to the report, entitled as “The Rise of the South: Human Progress in a Diverse World”, last year Kazakhstan was ranked by the HDI Index as 69 of 186 countries, surrendering one position compared with the previous rating. However, as noted by the Report authors, this is due to the "early growth rate of HDI components in the other states and the revision of calculation methods for some indicators”.

The HDI measures achievements of a country are based on two indicators: healthcare and longevity, as well as the education and quality of life of its citizens. The State rankings are divided into four categories: "very high", "high", "medium" and "low" levels of Human Development Index.

It is noteworthy that based on the key components of the Index we have demonstrated very good results. For the last 12 years, our HDI value has increased for 13.725%, i.e. the annual growth made about 1%. And this progress is being made in all directions. First, the life expectancy at birth has increased by 3.9 years, reaching 67.4 years. Second, the average number of years of schooling increased by six months-up to 15.3 years and the expected duration of education for 3 years-up to 10.4 years. Third, the gross national income grew in 2.07 times-up to $10 451. While all these factors have enabled Kazakhstan to maintain the stability of the HDI at the level of 0.754, the Republic was unable to leave the category of the countries with "medium human development", although we missed only one step to go to the higher position.

In this ranking Kazakhstan is steadily overtaking many post-Soviet countries. However, we cede to the Baltic countries considerably and even to our partners in the Customs Union-Russia (55th place, 0.788) and Belarus (50th place, 0.793).

The leaders of the rating with "very high" HDI level remain same: Norway, followed by Australia, the United States, the Netherlands and Germany. Following countries are New Zealand, Ireland, Sweden and Switzerland. The top ten is completed by Japan.

So, let's summarize. Based on the analysis of Kazakhstan's positions in the world's most famous tables of ranks, the joining of the top 30 most developed economies in the world looks pretty elusive. At least, for the coming years. As experts say, the Government will need to ensure the structural economic and institutional reforms. Both in the short and long term. And yet, as the proverb say, slow and steady wins the race...

How S & P, Fitch and Moody's rated Kazakhstan

For the completeness of the situation, it is required to provide Kazakhstan's sovereign ratings by three leading international rating agencies: Standard & Poor's, Fitch Ratings and Moody's Investors Service.

Let's start with S&P, as this Agency was the first to revise our country's sovereign ratings, decreased during the global financial turmoil of 2008. So, on November 8, 2011, S&P has upgraded the Kazakhstan’s sovereign credit rating in foreign currency from "BBB" to "BBB + with a stable outlook”. The Agency increased the short-term sovereign credit rating up to "A-2" from "A-3", as well as confirmed the rating according to national scale at the level of KzAAA. With regard to the long-term and short-term ratings in national currency, they were confirmed as "BBB +" and "A-2" respectively. S&P analysts justify their decision “by improving the flexibility of external financial position and a budget of Kazakhstan as a result of the budget surplus and the sustained economic growth, supported by the oil production and prices, prudent fiscal policies and permanent high inflows of the direct foreign investment”. S&P attributed the stable outlook on the Kazakhstan rating to the expectations that the high global commodity prices and government expenses stimulate the growth and maintain the stability of the state budget and the external financial position.

On November 21, 2011, just after S&P, our ratings were revised by the Fitch Ratings agency, which has upgraded the long-term issuer default ratings in foreign and national currency from "BBB-" to "BBB" and from "BBB" to "BBB +" respectively, with the "positive" outlook. Fitch explained this step by the improvement of "the sovereign balance with net balance of assets in foreign currency”. The "risks of lower energy prices and weakening of the financial sector, as well as political risks” are considered by the analysts as a restricting factor for Kazakhstan to further increase its ratings. However, in July 2013, Fitch confirmed the long-term issuer default ratings in foreign and national currency as “BBB-” and “BBB”, but revised the relevant outlook to "negative" one. Accordingly, the Agency analyst Andrew Colquhoun noted that "in medium term, the pressure on the ratings increases in downward direction, as the Kazakh banks, affected by the crisis and sharply slowing economy, may require the further government support over and above the substantial amounts that have already been allocated”.

Finally, the Moody's Investors Service was the last agency who revised our ratings. In September 2013, it has upgraded the ratings of Kazakhstan in foreign currency from Baa2 to Baa1. The ceiling on deposits in foreign currency has been raised from Ba1 to Baa3. Similar rating in national currency has been confirmed at A3 level, short-term ceiling for foreign currency bonds at Prime-2. The short-term ceiling for deposits in foreign currency increased from Not Prime to Prime-3.

By the way, Russia's sovereign ratings of these three agencies are on the same level with Kazakhstan. The only difference is in the "stable" forecast for Russian ratings, provided by Fitch, while Kazakhstan's ratings were changed to "negative" outlook by the same agency.